Zamora v. Morphix Company, LTD

Filing 102

OPINION & ORDER re: 69 MOTION for Summary Judgment Notice of Motion. filed by Morphix Company, LTD, 83 MOTION for Summary Judgment . filed by Melanie Zamora. Pending before this Court are the parties' cross-motion s for summary judgment on some, but not all, claims. Although the procedural posture of the case is convoluted, resolution of the substantive issues is straightforward. (As further set forth in this Order.) For the reasons set forth above, Zamora&# 039;s and MGZ's motion for summary judgment is GRANTED in part and DENIED in part, and Morphix's motion for summary judgment is GRANTED in part and DENIED in part. The Clerk of Court is directed to terminate the motions at ECF Nos. 69 and 83. (Signed by Judge Katherine B. Forrest on 1/10/2017) (cf)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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MELANIE ZAMORA,
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Plaintiff,
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-v:
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MORPHIX COMPANY, LTD,
:
:
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Defendant, Counterclaim Plaintiff,
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and Third-Party Plaintiff,
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-v:
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MELANIE ZAMORA,
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Counterclaim Defendant,
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MGZ CONSULTING, LLC,
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Third-Party Defendant.
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KATHERINE B. FORREST, District Judge:

USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: _________________
DATE FILED: January 10, 2017

15-cv-6532 (KBF)
OPINION & ORDER

In 2012, Morphix Company, Ltd. (“Morphix”) hired MGZ Consulting, LLC
(“MGZ”) to consult on a project for the BP Exploration Operating Company (“BP”).
This lawsuit arises out of a breakdown in that relationship that came to a head
when BP rescinded a job offer to Melanie Zamora, MGZ’s president. Prior to
rescinding the offer, Morphix had informed BP, inter alia, that hiring Zamora would
violate her non-compete agreement. Zamora subsequently sued Morphix for
tortious interference with contract; Morphix counterclaimed against Zamora and
filed a third-party complaint against MGZ for, inter alia, breach of contract.

1

Pending before this Court are the parties’ cross-motions for summary judgment on
some, but not all, claims. Although the procedural posture of the case is convoluted,
resolution of the substantive issues is straightforward. For the reasons stated
below, both motions for summary judgment are GRANTED in part and DENIED in
part.
I.

FACTUAL AND PROCEDURAL BACKGROUND
Unless otherwise noted, the following facts are undisputed.
At all relevant times, Zamora was MGZ’s president, managing member, and

agent. (Morphix Rule 56.1 Statement ¶ 13, ECF No. 87; Certificate of LLC
Formation, ECF No. 97-17; Zamora Dep. 12:1-3, ECF No. 97-13.) Morphix provides
consulting and technical services focused on improving and maintaining
organizational performance. (Morphix Rule 56.1 Statement ¶ 1.) In February 2011,
Morphix began work for BP on the BP Well Advisor Project (“BPWA project”), which
involved developing and deploying real-time monitoring and decision support
systems to improve the performance and safety of BP’s drilling operations. (Id. ¶¶
6, 7.) MGZ (Zamora’s company) was defined as the “Consultant” in a consulting
agreement (“CA”) with Morphix to work on the BPWA project with an effective date
of January 17, 2012. (Morphix Rule 56.1 Statement ¶ 11; id. Ex. C (“CA”), ECF No.
87-3.) Zamora executed the CA on behalf of MGZ. (Morphix Rule 56.1 Statement ¶
13.) Mark Newman, Morphix’s managing director, signed on behalf of Morphix.
(CA at 8.) The CA included, inter alia, the following provisions, each of which
Zamora and MGZ are alleged to have breached: Sections 2.3, 4.2, 8.2, 9.1, 9.2, 14.2,
and 16.1. The provisions may be divided into two general groups for purposes of
2

these motions—those that concern the protection of Morphix’s intellectual property
and confidential information (Sections 8.2, 9.1, 9.2, and 14.2), and those that
concern the protection of Morphix’s business interests. The latter sections limit the
work the consultant can accept (Section 2.3), direct the consultant to safeguard
Morphix’s commercial and contractual interests (Section 4.2), and require the
consultant not to compete with Morphix (Section 16.1). The Court sets forth these
provisions in full 1:

Category 1: Morphix’s Confidential Information & Intellectual Property
•

Section 8.2: “Unless otherwise agreed Morphix shall be entitled to the full
and sole benefit of any invention or improvement (whether patentable or
not) and to all Intellectual Property and Know How generated by the
Consultant as a direct result of performing the Services for Morphix in
accordance with this Agreement and Consultant hereby assigns in
consideration for fees payable hereunder . . . all such rights to Morphix
and acknowledges that such rights shall vest in Morphix solely and
absolutely.”

•

Section 9.1: “Consultant will not, except as authorized or required for the
proper performance of this Agreement, disclose to any person or company
any Confidential Information[]. This restriction shall continue to apply
after the termination or expiry of this Agreement, for whatever reason,
without limit in time but shall cease to apply to information and
knowledge which may come into the public domain other than through a
breach of this Agreement.”

•

Section 9.2: “All notes and memoranda of any Confidential Information
concerning the business of Morphix or any of its clients which shall be
acquired, received or made by Consultant during the course of this

In their submissions, the parties assume that the summary judgment motions as to the breach of
contract claim are intended to be entirely dispositive. However, they do not make specific arguments
regarding each CA section that Morphix alleges Zamora and MGZ breached. (See Countercl. &
Third-Party Compl. ¶ 107, ECF No. 24 (listing Sections 2.3, 4.2, 8.2, 9.1, 9.2, 14.2, and 16.1).)
Morphix, for example, only tangentially mentions Section 8, and Zamora and MGZ make only
general points related to Sections 14.2 and 16.1. Nevertheless, given that each section falls into one
of the two categories (e.g., confidential information or protection of business interests), the parties’
arguments regarding the sections they do address are equally applicable to those they do not.
Accordingly, the Court addresses all CA provisions mentioned in Morphix’s breach claim as pled.
1

3

Agreement shall be the property of Morphix and shall be surrendered by
Consultant to Morphix at the termination of this Agreement or at the
request of the Morphix at any time during the course of this Agreement.”
•

Section 14.2: “Upon the termination or expiration of this Agreement or
any Work Order Consultant shall within fourteen days return and deliver
to Morphix all Confidential Information and all other property and all
copies thereof belonging to Morphix or may have been provided to it by
Morphix, or which Consultant may have obtained as a result of
undertaking the Work Order on behalf of Morphix in accordance with this
Agreement. This includes, but is not limited to, equipment, books, reports,
documents, specifications, papers, information (on whatever media and
whether constituting Confidential Information or not) and this includes
any items to be delivered as part of a Work Order whether complete or in
process. Upon completion of this task Consultant shall explicitly certify in
writing that it has fulfilled the requirements of this clause.”

Category 2: Protection of Morphix’s Business Interests
•

Section 2.3: “Consultant warrants that it will not accept work from any
third party; i) using Intellectual Property owned by Morphix or; ii)
relating to products or services owned by Morphix.”

•

Section 4.2: “In the performance of its duties hereunder, Consultant shall
act so as to safeguard the Intellectual Property, commercial and
contractual interests of Morphix and shall comply with all reasonable
requests and directions of Morphix or its nominee.”

•

Section 16.1: “Consultant undertakes that it shall not, without the prior
written consent of Morphix, either during or within twelve months after
completion of this Agreement or termination of this Agreement, which
ever is the later, either directly or indirectly offer its services to, or accept
work from, companies, individuals or organizations which were partners,
associates, competitors or active prospects of Morphix during the period of
twelve months immediately prior to the completion or termination of this
Agreement. An active prospect is a company, individual or organization
with whom Morphix was negotiating at the time of completion or
termination of this Agreement or had held negotiations at any time during
a period of twelve months prior to the completion or termination of this
Agreement and where any such negotiations were known to Consultant.”

Twelve work orders set forth the specific work MGZ performed for Morphix
on the BPWA project for the time period from January 30, 2012 to December 31,

4

2014. (Morphix Rule 56.1 Statement ¶¶ 14-15; see also id. Ex. D (“Work Orders”),
ECF No. 87-4.) Zamora is listed as the “Named Individual,” the person tasked with
supplying services to Morphix, in each of the work orders. (Work Orders.) She
performed the work using a BP email address and a BP laptop, which she returned
to BP after the last work order was completed. (Zamora Decl. ¶¶ 12, 13, ECF No.
97-1.) The work orders are virtually identical except for the dates identifying the
period they governed and the description of the work to be performed. (Morphix
Rule 56.1 Statement ¶ 16.) Each work order was incorporated into the CA and was
governed by its terms and conditions. (Work Orders at 1; CA § 1.1.4 (“Each and
every Work Order placed shall be expressly governed by this Agreement and shall
be deemed incorporated herein.”).) Section 3 of the work orders also provides that
“the Named Individual [Zamora] . . . undertakes with Morphix in the terms of
[clauses 2.3, 8, 9, 14, and 15] of the [CA] such that the same shall constitute direct
undertakings and agreements between Morphix and the Named Individual.” (Work
Orders § 3.) Zamora signed the work orders. The parties dispute whether she
signed the work orders in her individual capacity or solely in her capacity as MGZ
President. (Zamora Resp. to Morphix Rule 56.1 Statement ¶ 17, ECF No. 88.)
Morphix claims—and Zamora disputes—that, by executing the work orders in her
individual capacity, Zamora also agreed to be personally bound by the CA. (Id. ¶
20.)
In September 2014, Zamora submitted a job application to BP. (Morphix
Rule 56.1 Statement ¶ 27.) On November 12, 2014, BP offered Zamora a job,

5

contingent on her passing a pre-employment screening process, which she accepted.
(Id. ¶¶ 28, 29, 31.) Morphix objected to Zamora accepting the BP job because of the
restrictions in the CA. (Id. ¶ 36.) On November 25, 2014, Newman (of Morphix)
sent an email to BP about Zamora’s job offer. (Newman Decl. Ex. 2, ECF No. 95.)
That email said that the job offer was “in direct conflict with the proposal we have
made to settle historic issues,” including a proposed agreement not to “solicit or
employ the other’s staff going forward.” (Id.) Newman also wrote that BP’s job offer
exposed Zamora to “legal action with regard to breaches of her own service contract
with Morphix.” (Id.) In a December 15, 2014 email to BP, Morphix’s lawyers wrote
that, “[i]f BP employs Ms. Zamora, she will be in breach of her Consulting
Agreement with Morphix and BP will be interfering with that contractual
relationship.” (ECF No. 97-11.) BP ultimately revoked the employment offer on
January 13, 2015. (Zamora Decl. ¶ 17; BP Email, ECF No. 1-3 (notifying Zamora
that BP was “rescinding our employment offer . . . due to the existence of a noncompete with your former employer”).)
On February 18, 2015, Zamora sued Morphix in the U.S. District Court for
the Southern District of Texas for a declaratory judgment (Count One) and tortious
interference with contractual relations (Count Two). (Compl., ECF No. 1.) The case
was transferred to this District on August 19, 2015. (ECF No. 21.) On October 2,
2015, Morphix answered the complaint and brought a counterclaim against Zamora
and a third-party complaint against MGZ. (Countercl. & Third-Party Compl.)
Relevant to this opinion, the first cause of action of the counterclaim and third-

6

party complaint alleges that Zamora and MGZ breached Sections 2.3, 4.2, 8.2, 9.1,
9.2, 14.2, and 16.1 of the CA when they sought and obtained an employment offer
from BP and failed to return Morphix’s intellectual property. (Id. ¶ 107.) In the
sixth cause of action, Morphix alleges that it is entitled to attorneys’ fees and costs
to the extent it prevails on any of its other claims. (Id. ¶¶ 130-132.) The other
counts of the counterclaim and third-party complaint, which are not addressed by
the parties’ summary judgment motions, allege tortious interference of contract and
business relations against Zamora and MGZ. (Id. ¶¶ 111-129.)
On July 7, 2016, Morphix filed a motion for summary judgment against
Zamora only, requesting that the Court grant partial summary judgment in
Morphix’s favor on its breach of contract claim on all issues but damages, and grant
summary judgment against Zamora on both the declaratory judgment and tortious
interference with contractual relations claims. (Morphix Mot. Summ. J., ECF No.
69; Morphix Mem. Law 1, 12, ECF No. 86.) In the response in opposition to
Morphix’s motion for summary judgment, Zamora withdrew her declaratory
judgment action against Morphix without prejudice. (Zamora/MGZ Resp. Opp’n 21,
ECF No. 89.) 2 On July 12, 2016, Zamora and MGZ filed a motion seeking summary
judgment against Morphix on its claim for breach of contract, and in Zamora’s favor
on her tortious interference of contract claim. (Zamora/MGZ Mot. Summ. J., ECF
No. 83; Zamora/MGZ Mem. Law 1, ECF No. 84.) All parties request attorneys’ fees

Although Morphix’s motion for summary judgment is directed at Zamora only, (see Morphix Mem.
Law at 12 n.5), the response in opposition to that motion was filed by both Zamora and MGZ,
(Zamora/MGZ Resp. Opp’n at 1).
2

7

and costs at various points in their briefs. 3 Accordingly, the claims that are before
the Court on the cross-motions for summary judgment are: (1) Morphix’s breach of
contract claim against Zamora and MGZ; (2) Zamora’s tortious interference with
contractual relations claim; and (3) the parties’ requests for attorneys’ fees and
costs. 4
II.

LEGAL PRINCIPLES
Summary judgment may not be granted unless a movant shows, based on

admissible evidence, “that there is no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The
moving party bears the burden of demonstrating “the absence of a genuine issue of
material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). On summary
judgment, the Court must “construe all evidence in the light most favorable to the
nonmoving party, drawing all inferences and resolving all ambiguities in its favor.”

Dickerson v. Napolitano, 604 F.3d 732, 740 (2d Cir. 2010). The Court’s function on
summary judgment is to determine whether there exist any genuine issues of
material fact to be tried, not to resolve any factual disputes. Anderson v. Liberty

Lobby, Inc., 477 U.S. 242, 248-49 (1986).
III.

ANALYSIS
As stated above, only certain claims are before the Court on the cross-motions

for summary judgment. The Court addresses each in turn.
It is not entirely clear from Zamora’s and MGZ’s motion whether they are moving for summary
judgment on Count Six of Morphix’s counterclaim and third-party complaint, which requests
attorneys’ fees and costs pursuant to Section 20.4 of the CA should Morphix prevail on any of its
claims.
4 This case was transferred from the Honorable Analisa Torres to the undersigned on November 22,
2016.
3

8

A.

Morphix’s breach of contract claim against Zamora & MGZ

“Under New York law, a breach of contract claim requires proof of (1) an
agreement, (2) adequate performance by the plaintiff, (3) breach by the defendant,
and (4) damages.” Fischer & Mandell LLP v. Citibank, N.A., 632 F.3d 793, 799 (2d
Cir. 2011). According to Morphix, Zamora and MGZ breached Sections 8.2, 9.1, 9.2,
and 14.2 of the CA. Each of these provisions concerns the protection of Morphix’s
confidential information, “know how,” and intellectual property. Morphix argues
that Zamora and MGZ breached these provisions when Zamora returned the laptop
BP had provided to her and when she attached the CA and work orders to her
publicly filed complaint. Separately, Morphix claims that Zamora and MGZ
breached certain CA provisions when Zamora accepted BP’s job offer, including
Section 2.3, which limits the work the consultant can accept; Section 4.2, which
requires the consultant to “safeguard the . . . commercial and contractual interests
of Morphix”; and Section 16.1, which is a non-compete provision.
As an initial matter, the parties do not dispute that Morphix and MGZ signed
a valid consulting agreement. There are, however, genuine disputes of fact as to
whether Zamora is individually bound under the work orders and CA and,
therefore, personally liable for any breach of those agreements, and whether MGZ
can be held liable for Zamora’s acceptance of BP’s job offer and alleged disclosure of
Morphix’s intellectual property and confidential information. The Court concludes
that, even assuming that Zamora and MGZ are alter egos of one another, there is
insufficient evidence to support a triable issue on the question of breach with
respect to the CA provisions relating to disclosure of Morphix’s confidential
9

information and intellectual property (Sections 8.2, 9.1, 9.2, and 14.2). In contrast,
there are triable issues of fact as to whether the provisions relating to Zamora’s
commitment to protect Morphix’s commercial and contractual interests, and
acceptance of BP’s job offer (Sections 2.3, 4.2, and 16.1) were breached.
1.

Claims regarding breach of Morphix’s confidential information
and intellectual property

As discussed above, Sections 8.2, 9.1, 9.2, or 14.2 of the CA address the
protection of Morphix’s intellectual property, “know how,” or confidential
information. Morphix argues that Zamora and MGZ breached each of the four
provisions either by: (1) returning Zamora’s laptop, which allegedly contained
Morphix’s confidential information and intellectual property, to BP rather than to
Morphix; or (2) attaching copies of the CA and work orders as exhibits to the
complaint. (See Morphix Mem. Law at 3, 17; Morphix Resp. Opp’n at 17-18, ECF
No. 91.) There are no triable issues of fact with regard to any claim based on these
provisions.
Critically, Morphix has not proffered any evidence that any of its intellectual
property or confidential information resided on the BP laptop. During his
deposition, Newman (Morphix’s managing director) agreed that, “at no time has
Morphix made any attempt to examine or take an image of the computer that Ms.
Zamora gave back to BP,” (Newman Dep. 254:15-19, 256:6-8, ECF No. 97-4), and
testified that he did not know what Morphix intellectual property or confidential
information Zamora actually possessed, (id. at 256:6-8). Additionally, Morphix fails
even to mention the BP laptop in its Rule 56.1 Statement. Thus, the summary
10

allegations asserting disclosure or misuse of confidential information fail for the
simple reason that no such information is identified. See, e.g., Barkley v. Penn Yan

Cent. Sch. Dist., 442 F. App’x 581, 582 (2d Cir. 2011) (summary order).
But in addition, claims of breach based on these provisions fail for another
reason: lack of a triable issue as to the element of damage. Morphix has failed to
demonstrate that it suffered any harm by the disclosure of any intellectual property
or confidential information on the laptop. 5 Newman’s report is Morphix’s only
support for its damages claims. (Newman Decl. Ex. 1 (“Newman Report”), ECF No.
95.) But nowhere does Newman state that Morphix was in fact harmed by BP’s
receipt of the laptop. The closest Newman gets is when he says that, “without
possession of its own Intellectual Property and Know How relating to the BPWA
Project, Morphix had no opportunity to make a timely proposal to BP to use another
Morphix associate to replace Zamora and MGZ on the BPWA Project.” (Id. at 7.)
This statement is made, however, without any proffer as to any information
actually known to be on the laptop. Moreover, Newman goes on to state that, when

Morphix has moved for summary judgment on the liability aspect of its breach of contract claim
against Zamora. (Morphix Mot. Summ. J. at 1; Morphix Mem. Law at 1, 12.) Zamora and MGZ,
however, do not limit their motion for summary judgment on that claim to liability only. In all
events, whether or not Morphix has moved on the quantum of damages does not eliminate that issue
from those before the Court: Damages are an essential element of a breach of contract claim. See
LNC Invs., Inc. v. First Fid. Bank, N.A. New Jersey, 173 F.3d 454, 465 (2d Cir. 1999) (“Under New
York law . . . ‘[t]he failure to prove damages is . . . fatal to [a] plaintiff’s breach of contract cause of
action.” (alterations in original) (internal quotation marks omitted)). In other words, without
proving some amount of damages, a party cannot prevail on the liability aspect of a breach of
contract claim. See id. So long as it is clear that the party has sustained some damage, however,
summary judgment may be granted on the remainder of a contract claim with a damages
determination to await trial. See, e.g., U.S. Bank Nat’l Ass’n v. Southwest Airlines Co., No. 07 Civ.
11131, 2009 WL 2163594, at *12 (S.D.N.Y. July 20, 2009); Citicorp Leasing, Inc. v. Kusher Family
Ltd. P’ship, No. 05 Civ. 9163, 2006 WL 1982757, at *8 (S.D.N.Y. July 14, 2006) (finding that
defendants were liable to plaintiff but that “[t]riable issues of fact as to the calculation of various
damages components still remain, and this must be decided at trial”).
5

11

BP decided to replace Zamora and MGZ with in-house personnel, Morphix was itself
required to provide the BP employee with access to Morphix’s confidential
information, suggesting that Morphix never lacked access to needed materials. (Id.)
Finally, Morphix has previously taken a position inconsistent with any harm
resulting from Zamora’s relinquishment of the laptop. Morphix’s attorney
previously communicated to Zamora that once she “turned in her laptop and []
explained where her documents [we]re stored,” she was “in compliance with her
contractual obligations.” (Letter from Morphix Counsel 1, ECF No. 97-12.)
There is also no evidence that Zamora’s attachment of the CA and the twelfth
work order to her complaint actually harmed Morphix. Newman asserts that by not
filing these attachments under seal, Zamora gave “Morphix’s competitors, existing
and prospective clients, and existing and prospective associates, access to
Confidential Information that they can use to their commercial advantage,”
(Newman Report at 8), and “caused Morphix economic harm in the amount of
$228,440 over the next five years” because, inter alia, “prospective clients would
have visibility [in]to Morphix[’s] gross margins and would seek a reduction” in fees,
(id. at 9). This assertion is not based on anything more than speculation and
argument. No facts—such as loss of business—are cited as support. It is
insufficient to raise a triable issue on the damages element of that breach claim.
Moreover, Morphix did not raise any issue of filing the CA or work orders under seal
until March 2016—ten months after Zamora served Morphix with the summons and
complaint. (Sealing Request, ECF No. 51; Mot. Transfer Venue 1, ECF No. 8.) If

12

Morphix “was concerned about the disclosure of confidential information, it should
have immediately moved the court to seal the documents.” ING Global v. United

Parcel Serv. Oasis Supply Corp., No. 11 Civ. 5697, 2012 WL 4840805, at *6
(S.D.N.Y. Sept. 25, 2012) (dismissing on summary judgment defendant’s
counterclaim that plaintiff violated the confidentiality provisions of an agreement
by not redacting or filing under seal the exhibits attached to the complaint). And
when it did request permission to file the CA and work orders under seal, Judge
Torres denied the request, noting that the common law presumptive right of access
to judicial documents is particularly strong where, as here, the documents at issue
are material to the court’s disposition of the case. (Order, ECF No. 53.) In addition,
this argument is directly contradicted by Morphix’s own reliance on these same
materials in support of its May 2015 motion to transfer venue. (See Morphix Mot.
Transfer Venue Exs. A & B, ECF No. 8-1.) That motion was filed on the public
docket.
Accordingly, because Morphix’s suspicions about the contents of the BP
laptop are insufficient to create a genuine dispute of material fact, and because
Morphix has failed as a matter of law to establish damages related to Zamora’s
alleged disclosure of Morphix’s confidential information and intellectual property,
Zamora’s and MGZ’s motion for summary judgment on Morphix’s breach of contract
claim as it pertains to CA Sections 8.2, 9.1, 9.2, and 14.2 is granted, and Morphix’s
motion for summary judgment against Zamora on these same grounds is denied.

13

2.

Section 2.3

The Court next analyzes whether summary judgment is warranted to either
side on the breach of contract claim relating to Section 2.3. That section provides
that “Consultant warrants that it will not accept work from any third party; i) using
Intellectual Property owned by Morphix or; ii) relating to products or services
owned by Morphix.” (CA § 2.3.) There are four issues relevant to whether Section
2.3 has been breached by Zamora and MGZ: (1) whether Zamora is bound by the CA
at all (that is, whether MGZ and Zamora are alter egos), (2) whether Zamora
“accepted” work from a third party, (3) whether such work relates to products or
services owned by Morphix, and (4) whether Morphix was harmed. 6 There are
triable questions of fact as to issues (1), (3), and (4).
First, as stated above, there are triable issues of fact as to whether Zamora is
a party to the CA—a question which requires resolution of the alter-ego issue. That
is a fact-intensive inquiry not amenable to resolution at this stage. Additional
triable issues arise with regard to the third and fourth questions. For the third
question, the Court agrees with MGZ and Zamora that the only grammatical
reading of Section 2.3 is that it prohibits the consultant from accepting any work
from a third party where such work assignment “relat[es] to products or services
owned by Morphix.” Morphix’s interpretation of the provision—that it is meant to
prohibit the consultant from accepting work from a third party when that third

party’s business—broadly stated—“relat[es] to products or services owned by

It is undisputed that MGZ (the entity) is defined as the “Consultant” in the CA; the parties dispute
whether the record is sufficient to show that MGZ is simply Zamora’s alter ego.
6

14

Morphix”—greatly extends the reach of the provision and is incorrect. (See, e.g.,
Morphix Reply 20.) The provision clearly sets up subparts (i) and (ii) as modifying
the word “work.” With this interpretation in mind, there is a genuine triable issue
regarding whether the job Zamora accepted “relat[ed] to products or services owned
by Morphix.” On the one hand, Zamora testified that her work on the BPWA project
would not have been helpful for or relevant to the position BP offered her. (See, e.g.,
Zamora Dep. at 174:16-175:16.) On the other hand, BP offered Zamora a position
related to the maintenance of blowout preventers, (id. at 170:13-19), and the BPWA
project likewise had a blowout preventer component, (id. at 170:22-23).
As to the fourth issue, Newman’s report is sufficient to create a genuine
dispute about whether Morphix was harmed by Zamora’s acceptance of BP’s job
offer. In particular, Newman states that, without advance notice that Zamora had
sought and accepted BP’s job offer, Morphix was unable to submit a transition plan
to BP, and that BP in turn decided it would move in house the work Zamora had
been performing. According to Newman, this series of events resulted in lost
income of $298,129. (Newman Report at 7, 9.) Although Zamora and MGZ argue
that Morphix has offered no evidence to support its statement that BP’s decision to
go in house was due to any wrongdoing by Zamora, the contentions in Newman’s
report are sufficient to establish at least a genuine issue of material fact with
regard to damages. (Zamora/MGZ Reply 6-7, ECF No. 96.)
While these questions of fact preclude summary judgment, the Court notes
that the second question does not require the resolution of disputed fact issues. The

15

argument that Zamora never “accepted” work from BP because she never executed
an employment contract is based on a misreading of the relevant contractual
provision. (Zamora/MGZ Mem. Law at 32.) The correct question is not whether
Zamora ever became a BP employee, (id. at 34), but whether Zamora “accepted
work” from BP. Zamora agreed with Morphix’s Rule 56.1 statement that she
“accepted the [job] offer from BP” on November 12, 2014. (Zamora Resp. to Morphix
Rule 56.1 Statement ¶ 29.) Zamora also concedes that she “previously testified that
she had received a formal offer of employment [from BP] which she had accepted.”
(Id. ¶ 33; see also Zamora Dep. at 187:18-20 (testifying that she “g[o]t more than a
conditional offer from BP” because she “got the job offer”).) Therefore, even if the
offer was conditioned on a background check, there is no genuine dispute that
Zamora still “accept[ed] work from [a] third party.” (CA § 2.3.)
Accordingly, because there are issues of fact about whether Zamora or MGZ
breached Section 2.3 of the CA, the parties’ motions for summary judgment with
regard to this provision are denied.
3.

Section 4.2

The Court now turns to Section 4.2. That provision of the CA requires the
Consultant to “safeguard the . . . commercial and contractual interests of Morphix.”
To determine whether summary judgment is appropriate, the Court must analyze
two separate issues: (1) whether MGZ and Zamora are alter egos—a question as to
which there are triable issues as discussed above, and (2) whether Zamora failed to
“safeguard” the “commercial and contractual interests” of Morphix; there are triable
issues as to this second question. Newman has stated that Zamora’s acceptance of
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BP’s offer resulted in the loss of work on the BPWA project for Morphix. (Newman
Report at 7.) Zamora denies this. (Zamora/MGZ Reply at 6-7.) Accordingly, the
parties’ motions for summary judgment on Morphix’s breach of contract claim as it
relates to Section 4.2 of the CA are denied.
4.

Section 16.1

Lastly, the Court examines whether summary judgment is appropriate with
regard to Section 16.1. Section 16.1 is a non-compete clause. It provides that the
“Consultant . . . shall not, without the prior written consent of Morphix, either
during or within twelve months after completion of this Agreement or termination
of this Agreement . . . either directly or indirectly offer its services to, or accept work
from, companies, individuals or organizations which were partners, associates,
competitors or active prospects of Morphix during the period of twelve months
immediately prior to the completion or termination of this Agreement.” (CA § 16.1.)
To determine whether summary judgment is appropriate with regard to this
provision, the Court must examine four issues: (1) whether MGZ and Zamora are
alter egos (which the Court has already determined presents a triable fact
question), (2) whether Zamora “accepted” work (which the Court has already
determined is undisputed and in the affirmative), (3) whether Zamora, while
working on the BPWA project, knew that Morphix and BP were negotiating the
renewal of their contract (an issue that Zamora concedes, (Zamora Dep. at 113:219)), and (4) whether Morphix was harmed by any breach of this provision. The
triable issues with regard to questions (1) and (4)—already discussed above—
preclude summary judgment with respect to a breach claim based on this provision.
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B.

Zamora’s tortious interference with contractual relations claim

Zamora also has asserted a claim for tortious interference of contract. Under
New York law, this claim requires “the existence of [a] valid contract with a third
party, defendant’s knowledge of that contract, defendant’s intentional and improper
procuring of a breach, and damages.” White Plains Coat & Apron Co. v. Cintas

Corp., 867 N.E.2d 381, 383 (N.Y. 2007). 7 Here, Zamora and MGZ admit that
Zamora “did not have a final contract in place with B.P. when Morphix contacted
B.P.” (Zamora/MGZ Mem. Law at 35.) Instead, they argue that “there is no dispute
that BP and Zamora were in the position to enter into an employment contract
relationship,” and that Morphix “deliberately took steps to prevent that contract
from taking place.” (Id.)
As Morphix notes in its opposition, and which is uncontested in Zamora’s and
MGZ’s reply, plaintiff did not bring a tortious interference with business relations
claim. (See Morphix Resp. Opp’n at 30; see also Compl. ¶¶ 39-47 (bringing a second
cause of action for “Tortious Interference with Contractual Relations”);
Zamora/MGZ Reply.) Accordingly, the Court will not construe Zamora’s second
cause of action as a claim for tortious interference with business relations. Because

Morphix, in its opposition brief, notes that, “[w]hile some of the acts that gave rise to Zamora’s
tortious interference with a contract claim occurred in Texas, because those acts related to duties
arising under the [CA] and Work Orders, the claim may be subject to the New York choice of law
provision governing those agreements.” (Morphix Resp. Opp’n at 28 n.13.) Because Zamora and
MGZ only cite to New York law, and because, insofar as certain principles are necessary to resolution
of these motions, there are no material differences between tortious interference with contract under
Texas and New York law, the Court refers to New York law for convenience. See Hometown 2006-1
1925 Valley View LLC v. Prime Income Asset Mgmt., LLC, No. 13 Civ. 04440, 2016 WL 6464485, at
*2 (N.D. Tex. Mar. 29, 2016) (noting that, under Texas law, tortious interference with contract
requires (1) the existence of a contract, (2) willful and intentional interference, (3) causation, and (4)
damages).
7

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Zamora and MGZ concede that no contract existed between Zamora and BP,
summary judgment on Zamora’s second cause of action is granted in favor of
Morphix. 8
C.

The parties’ claims to attorneys’ fees and costs

It is unclear from their motion whether Zamora and MGZ are moving for
summary judgment on Count Six of Morphix’s counterclaim and third-party
complaint. It is clear from the briefing, however, that Zamora and MGZ, as well as
Morphix, seek attorneys’ fees and costs. The CA provides that, “[i]n the event legal
proceedings are commenced arising out of or relating to this Agreement, the
prevailing party shall be entitled to reasonable attorneys’ fees and costs incurred in
connection therewith.” (CA § 20.4.) In light of the Court’s rulings, however, “it is
premature to declare either party ‘the prevailing party’ within the meaning of this
provision.” Purchase Partners, LLC v. Carver Fed. Sav. Bank, 914 F. Supp. 2d 480,
506 (S.D.N.Y. 2012). Accordingly, to the extent that any of the parties have sought
summary judgment on Count Six of Morphix’s counterclaim and third-party
complaint, those motions are denied.
*

*

*

In addition to granting Morphix’s motion for summary judgment on this ground, the Court grants
summary judgment in Morphix’s favor on Zamora’s and MGZ’s motion for summary judgment on
this claim. Zamora and MGZ are not procedurally prejudiced by this decision because “the court’s
sua sponte determination is based on issues identical to those raised by the moving party.”
Bridgeway Corp. v. Citibank, 201 F.3d 134, 140 (2d Cir. 2000). Here, in bringing their own motion
on this claim and defending against Morphix’s motion, Zamora and MGZ had a full and fair
opportunity to establish their case and provided no “indication that [they] might otherwise bring
forward evidence that would affect the court’s summary judgment determination.” Coach
Leatherware Co. v. AnnTaylor, Inc., 933 F.2d 162, 167 (2d Cir.1991). As the Court has before it all
the facts necessary to find for Morphix, the Court may grant summary judgment in its favor on this
issue sua sponte.
8

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In summary:
(1) Zamora’s and MGZ’s motion for summary judgment on Morphix’s
breach of contract claim as it pertains to Sections 8.2, 9.1, 9.2, and 14.2 of
the CA is GRANTED, and Morphix’s motion for summary judgment
against Zamora on those same grounds is DENIED;
(2) The parties’ motions for summary judgment on Morphix’s breach of
contract claim as it pertains to Sections 2.3, 4.2, and 16.1 of the CA are
DENIED;
(3) The Court grants summary judgment in Morphix’s favor on Zamora’s
tortious interference with contract claim;
(4) To the extent that any party has sought summary judgment on Count
Six of Morphix’s counterclaim and third-party complaint related to
attorneys’ fees and costs, those motions are DENIED;
(5) Zamora has withdrawn her declaratory judgment claim against
Morphix; and
(6) Morphix’s tortious interference claims against Zamora and MGZ were
not raised in these motions for summary judgment and therefore have not
been addressed by the Court.
IV.

CONCLUSION
For the reasons set forth above, Zamora’s and MGZ’s motion for summary

judgment is GRANTED in part and DENIED in part, and Morphix’s motion for
summary judgment is GRANTED in part and DENIED in part.

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The Clerk of Court is directed to terminate the motions at ECF Nos. 69 and
83.
SO ORDERED.
Dated:

New York, New York
January 10, 2017

_________________________________________
KATHERINE B. FORREST
United States District Judge

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